THE TRUTH ABOUT MRT3

MANILA, Philippines - An opposition lawmaker urged yesterday the Department of Transportation and Communications (DOTC) to stop blaming others and instead work immediately to rehabilitate the Metro Rail Transit 3 (MRT-3) following recent accidents and breakdowns.

Kabataan party-list Rep. Terry Ridon issued the statement at the continuation yesterday of the inquiry conducted by the House committee on Metro Manila development on the problems plaguing MRT-3.

“The simple truth is this: the MRT has been breaking down because of government neglect,” Ridon said.

The lawmaker said the government had five years to fix the MRT, and the suffering of the 500,000 riders daily could only be attributed to the failure of government to improve the services of the MRT.

MRT general manager Roman Buenafe told the panel chaired by Quezon City Rep. Winston Castelo that the restrooms of the rail system would be repaired starting today at the North Avenue station.

Buenafe also said MRT-3 will close at 9 p.m. on Saturday and resume at noon on Sunday for repairs of some broken rails.

During the hearing last Tuesday, the private owners of MRT-3 pushed their proposal to rehabilitate and improve the rail system that will be at no cost to the government.

MRT Holdings chairman Robert Sobrepeña warned lawmakers that if the rehabilitation of the MRT is not done immediately, the condition of the rail system will only get worse and lives will continue to be in danger.

The MRT Holdings proposal to the DOTC includes three options – a full rehabilitation of the MRT-3 System including general overhauling of all 73 light rail vehicles (LRVs); rehabilitation and upgrade of the system to accommodate additional LRVs; upgrade of MRT3 Phase II (Line 1 North Extension) with additional 48 to 79 LRVs.

Under the proposal, Sumitomo Corp. will return as maintenance provider of the MRT but will also undertake full rehabilitation of the MRT-3 system to restore it to an acceptable condition.

“I need to stress the need to change the maintenance provider immediately and this proposal does that. We bring back Sumitomo and they will restore the system back to brand new status immediately,” Sobrepeña told the panel.

He said the proposal would be at no cost to government, as the private sector will raise $98 million for the rehabilitation of the MRT and $53 million for the two-year special maintenance contract, including the general overhauling of LRVs.

The MRT Corp. will then take over MRT-3 operations, management and maintenance of the MRT-3 system until 2030 through a 15-year management contract.

He said the proposal would also address the desire of the DOTC for an equity value buyout (EVBO).

Under the first option of the proposal, the MRT-3 bonds and related securities currently held by Land Bank and Development Bank of the Philippines will be bought out by the private sector.

This will get rid of the need for government to raise P54 billion just for an EVBO, he said.

At the same time, there is also a guarantee that ownership of the MRT-3 will be turned over to government as envisioned in the build-lease-transfer agreement in 2025, he said.

The DOTC will also benefit from this proposal as the model will allow for the agency to receive five percent gross revenue sharing from fare box.

It was revealed in the hearing that the present maintenance provider, APT Global, has not been purchasing spare parts.

DOTC Undersecretary Jose Lotilla admitted that the maintenance provider is supposed to buy spare parts but has not been making the purchases, forcing the agency to offer to buy the spare parts.

Sobrepeña compared this to the practice of Sumitomo of allotting 60 percent of its budget to spare parts and having more than enough to turn over to a previous maintenance provider when their contract ended.

He also stressed that it would be very damaging for government to further chop up contracts.

“We don’t agree with government chopping up contracts. This only results in finger pointing and no guarantees would materialize. That is why there have been many failed bids. It is important to have a single point of responsibility,” he said.

Meanwhile, Metro Pacific supported the proposal of MRT Holdings.

“We are supportive of Mr. Sobrepeña’s proposal if that is the pleasure of the government,” Jose Lim, president of Metro Pacific, said.